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It was bound to happen.
After almost two decades of helping middle-market business owners navigate the complexities of corporate mergers and acquisitions, Minneapolis investment banker Jack Helms found himself on the opposite side of the negotiating table in 2006. It was then the Iowa- raised banker felt the nerve-wrenching anxiety an entrepreneur feels when selling their business as he discussed the possibility of being acquired by Lazard with his co-chief executives at Goldsmith Agio Helms, Michael McFadden and David Solomon.
After 20 years of working with clients and holding their hands through the process, I was the seller and an emotional one who had all the same issues as my clients, Helms admits.
It was an understandable reaction.
Helms had built the investment bank from the ground up after joining his former and now-retired partner Steven Goldsmith in 1987 to set up a two-person corporate M&A advisory firm. The pair launched their business from offices situated above a drive-through bank in suburban Minneapolis. Over the next 19 years, the 12-person partnership grew into a large operation with its headquarters located on the 46th floor of a high rise in downtown Minneapolis and employing 90 professionals spread between offices in New York, Chicago and Los Angeles.
By the time Helms, McFadden and Solomon were considering the idea of selling the investment bank, the middle-market M&A business had changed markedly since the beginning of the New Millennium. The business was sophisticated, and peppered with other M&A advisory shops and specialty lenders serving mid-sized private equity buyouts. Once regional boutique M&A shops had transformed into global advisory firms through alliances with European banks and international offices-Goldsmith Agio itself had done the same, as well as opened an office in Shanghai in 2003.
Meanwhile, a number of middle-market banks were pursuing liquidity events through sales to larger organizations. Liquidity wasnt the primary motive for the executives of the Minnesota investment bank in their consideration of doing a transaction with another bank, according to Helms. We were pursuing a strategy and resource-driven transaction that would enable us to provide even higher quality services to our clients, he says.
The idea of being owned by a balance sheet-driven Wall Street institution wasnt appealing since Helms and his colleagues were concerned...